Consider the following fixed basket of goods and services: 100 loaves of bread, 25 bus tickets, 1 Room for Rent.

	1 Loaf of Bread	Bus Ticket	Price of Room Rental
2015	$2.00	$.05	$1,000.00
2016	$3.00	$.15	$1,500.00

a, What are the 4 steps to calculating the consumer price index? What is the value of CPI in 2015 and 2016 (Use a base year of 2015)?

b, What was the rate of inflation for this economy from 2015 - 2016?

c, Consider the following: A movie ticket costs $2.40 in 1960. If the CPI in 1960 is 33.25 (Base year: 2015), what is the value of the movie ticket in 2016?